Just like you never want to hear a doctor say "oops" in the operating room, you never want to see a going-concern statement in a financial report about a company you own. Accountants throw these in when they've been over the books, talked to customers, and checked the horoscopes and have concluded there is "substantial doubt" about a company's ability to remain in business. In short, don't blame the accountants if the company files for bankruptcy protection.

You¿d reckon that a going-concern statement would be enough to send investors running to the exits, but it's not. True, many large institutions automatically bail when an existing company gets slapped with one of these, but many individuals (often wrongly) take a chance they know more than the bean counters.

During the tech boom of the late 1990s, many companies actually went public even though they had been hit with going-concern statements. Many of those companies subsequently disappeared. Enough said.

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Wednesday, July 23, 2008

Zacks Analyst Blog Highlights: JA Solar Holdings Co., Ltd., Buffalo Wild Wings Inc., Wright Medical Group Inc., Aon Corp. and BHP Billiton Ltd.

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CHICAGO, Jul 23, 2008 (BUSINESS WIRE) ----Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: JA Solar Holdings Co., Ltd. (Nasdaq:JASO), Buffalo Wild Wings Inc. (Nasdaq:BWLD), Wright Medical Group Inc. (Nasdaq:WMGI), BHP Billiton Ltd. (NYSE:BHP) and Rio Tinto Plc (NYSE:RTP).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=4579

Here are highlights from Tuesday's Analyst Blog:

Bullish on JASO

JA Solar Holdings Co., Ltd. (Nasdaq: JASO) is enjoying strong global demand for its PV cells. The growth potential for the solar industry as a whole is very promising. Going forward, JASO's growth story will be boosted by increasing demand for solar energy, ongoing capacity expansions and committed supply of key raw materials.

However, rising silicon wafer costs and the company's high R&D expenses may put pressure on margins over the near-term. Accordingly, we maintain our Buy recommendation on JASO with a six-month target price of $22.00. Price appreciation to our near-term valuation target represents 37.4% upside potential.

BWLD is Well Positioned in Tough Industry

Boasting a track record of strong annual growth and a viable strategy, Buffalo Wild Wings Inc. (Nasdaq: BWLD) is well positioned in our view to attain its annual 25% net income growth over the next three years. A key growth driver will be the company's ability to continue its recent improvement in company-owned average weekly sales and bring it in line with its franchisees.

Despite falling 49% from its 52-week high, the BWLD shares still trade at a slight premium to the restaurant growth group. We think the company's high exposure to the price of chicken wings and rising minimum wage rates offset the premium it deserves owing to a unique concept that has delivered consistent annual EPS growth. Moreover, we would recommend caution in buying restaurant growth stocks while the industry faces significant macro headwinds with murky visibility to recovery.

WMGI Faces Risks; Maintaining Estimates

We are maintaining our estimates on Wright Medical Group Inc. (Nasdaq: WMGI), which reports earnings on July 28. The Securities and Exchange Commission's (SEC) informal investigation into the industry's foreign selling practices, along with the ongoing Department of Justice (DOJ) investigation, might create some overhang in the stock. We believe the company has a solid outlook based upon recent extremity-related acquisition and large-joint product flow activity. Our target moves to $31.00.

In the first quarter 2008, Wright Medical reported hip growth of 16% worldwide. Physician acceptance for metal-on-metal appears to be continuing, versus ceramic-on-ceramic, which suggests the August 2005 launch of the A-Class Advanced Metal Low Wear Metal-on-Metal hip continues to make inroads. In February 2008, the company introduced Supercap, a total hip arthroplasty surgical technique that does not require the hip to be dislocated during the procedure. Extremities rose 57% in the first quarter 2008. Management expects growth in excess of 30% in extremities for 2008.

BHP Benefits from China and its Balance Sheet

BHP Billiton Ltd. (NYSE: BHP) is the world's largest diversified resource company with operations in 25 countries. Notwithstanding the associated anti-trust issues, we believe a potential merger between BHP and Rio Tinto Plc (NYSE: RTP) can deliver synergy benefits and offset rising operating costs, which have been trending upwards.

In addition, the merged company would become the world's largest producer of copper and aluminum, and the second-largest provider of iron ore. Nonetheless, given that Rio Tinto rejected the terms of the original proposal, the deal seems far from certain. Moreover, fear of a global economic slowdown leads us to maintain a cautious outlook on the stock. We retain our Hold recommendation on shares of BHP.

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About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

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About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=4580.

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